V M SYED MOHAMED AND COMPANY Vs. STATE OF MADRAS

JUDGEMENT

(1.) THESE writs raise the question of the validity of the madras General Sales Tax Act (IX of 1939) and of the Turnover and Assessment rules, 1939, framed thereunder hereinafter called the Rules. The petitioners in writ Petitioners No. 21 of 1952 are doing business as tanners in Eluru. The course of business is that they purchase raw hides and skins and tan them in their own tannery. They hold a licence as tanners under the Act. Under Rule 15, they were submitting monthly returns of hides and skins purchased by them for the purpose of tanning in From No. A-4 and an order was passed on 23rd february, 1951, on the basis of these returns determining the tax payable at Rs. 10-180-7-3. Payments amounting to 4, 790-13-0 had been made by the petitioners towards the amount of the tax and for the balance of Rs. 5, 389-10-3 remaining payable, a demand was duly made by notice under Rule 15 (4 ). No appeal was taken against the order of assessment and it has become final. Nor was any action instituted to contest its validity. The tax not having been paid, the commercial Tax Officer instituted proceedings under Section 15 (b) of the Act for the recovery of the amount. The section so far as it is material runs as follows :- "any person who fails to pay within the time allowed, any tax assessed on him, or any fee due from him, under this Act shall, on conviction by a Presidency Magistrate or a Magistrate of the first class, be liable to a fine which may extend to one thousand rupees, and in the case of a conviction under clause (b), the Magistrate shall specify in the order the tax, fee or other amount, which the person convicted has failed or evaded to pay or has wrongfully collected, and the tax, fee or amount so specified shall be recoverable as if it were a fine. " *

(2.) THESE proceedings are now pending before the Honorary special First Class Magistrate, Eluru, as C. C. No. 88 of 1951. The petitioners have taken out this writ for quashing these proceedings on the ground that the act and the Rules and the assessment made thereunder are void and that the prosecution is illegal.

(3.) THE contention that Section 16-A is opposed to natural justice must, therefore, be rejected. Mr. K. V. Venkatasubramania Ayyar urged that the Madras general Sales Tax Act was void on the following grounds :- (1) THE Provincial Legislature had no power under the government of India Act of 1935 to enact a law imposing a tax on purchasers. (2) THE liability to pay a tax on sales is thrown on the purchaser not by the statute, but by the Rules. This is an unconstitutional delegation by the Legislature of its functions to the executive and the imposition of the tax is accordingly illegal. (3) THE Act has become void under article 14 of the Constitution, as it singles out for taxation purchasers in some trades and is, therefore, discriminatory. (4) THE Rules framed under the Act are inconsistent with the provisions enacted in the body of the Act and are void.